TV18 Broadcast, Hathway, Den Networks merger into Network18 called off
What's the story
The merger of Den Networks, TV18 Broadcast, and Hathway Cable & Datacom with Network18 Media has been canceled.
This comes after Mukesh Ambani-led Reliance Industries Limited (RIL) called off the transaction.
Den said that it was not going to proceed with the composite scheme of arrangement in which it was to merge with Network18 Media.
Their merger was announced last year.
Statement
'Decided to not proceed with arrangement envisaged in the scheme'
In a statement to the stock exchanges, Den Networks, an RIL-owned cable distribution company, said, "Considering that more than a year has passed from the time the board considered the scheme, it has decided to not proceed with the arrangement envisaged in the scheme."
It added the shareholders were aware that the scheme was filed with both BSE and NSE for their no-objection letter.
Cutting down
RIL had launched an Offer For Sale last month
The development comes just a month after RIL had launched an Offer For Sale (OFS) to cut back its stakes in both Den and Hathway.
Subsidiaries of RIL were aiming to pare its 19.1% stake in Hathway, amounting to Rs. 853 crore, and 11.63% in Den for Rs. 269 crore.
Ever since the OFS, share prices of the firms have fallen.
Looking back
The merger was announced in February last year
The merger was announced on February 17 last year.
Under the scheme, all the entities were to merge under one integrated company, the Network18 Media & Investments.
This media and distribution firm was to have a revenue of Rs. 8,000 crore.
To recall, shares of all the four companies, TV18 Broadcast, Network18 Media, Den, and Hathway had jumped up to 20% on merger news.
Data
TV18 Broadcast reports a 16% growth
On a related note, TV18 Broadcast, a listed subsidiary of Network18, reported a 16% year-on-year (YoY) growth in earnings before interest, taxes, depreciation, and amortization (EBITDA) at Rs. 279 crore. However, operating revenue declined by 5% to Rs. 1,348 crore.